As if spiralling oil prices weren’t enough, car prices could also see another hike soon. Market leader Maruti Suzuki on Wednesday indicated that it may hike prices of its top models further.
“The impact is very high,” said Kenichi Ayukawa, managing director and CEO of Maruti Suzuki, about the increasing cost to the company on components and raw materials.
Maruti has been buffeted by an acute shortage of semiconductors as well as spiralling input costs over the past year. The company had hiked prices three times over the last year — by 1.4 per cent in January, 1.6 per cent in April and 1.9 per cent in September, to a cumulative nearly 5 per cent.
Perhaps, it is time for another round now. “We are facing big pressure as far as commodities go,” said Shashank Srivastava, senior executive director (marketing and sales), Maruti Suzuki. “We were hoping to soften [the blow]. Going forward, we will take appropriate decisions,” he added.
Ayukawa and Srivastava were talking to the media after the global launch of the company’s ‘New age’ Baleno—a new variant of the million-selling premium compact model of the automaker originally launched back in 2015. The new age model sports a new K 12 engine and design tweaks, but the most dramatic addition is that of internet features, including a customisable advanced voice assist feature, as well as remote access, tracking, geo-fencing, trip analysis facilities as well as a hydraulic clutch.
The new age Baleno already has more than 25,000 bookings, according to Srivastava, and deliveries have already started. The pricing starts at Rs 6.35 lakh, going up to Rs 9.49 lakh for the ‘Alpha AGS’ one. The car is also available under Maruti’s subscription model, with plans starting at Rs 13,999 per month.
Yet, it remains to be seen how long these prices will remain, before the impending hike. The hardening of commodity prices, shortage of chips and increase in shipping tariffs, all part of the global supply chain mismatch scene after Covid-19, has caused price hikes for many top Indian automobile brands, both two as well as four-wheelers.
Inflationary trends in the economy could make the situation further acute. The Russia-Ukraine crisis has already seen global crude oil prices inching higher and higher, and many believe it is just a matter of UP polling getting over, before petrol and diesel prices are sharply raised again.
